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Testing the Engel's law in the consumption pattern of Romanian population

Author

Listed:
  • Neagu Mădălin-Ioan

    (Technical University of Cluj-Napoca, Romania)

  • Teodoru Mircea Constantin

    (Faculty of Economics, Engineering and Informatics, Vasile Goldiș Western University of Arad, Romania)

Abstract

The aim of the paper is to test the valability of Engel's law in the Romanian consumption dynamics after 1990. We used NIS ad EUROSTAT data to interpret the dynamics of the households' income and consumption expenditures and its structure by destinations. We explored the relationship between consumption and income through the regression analysis and found that the Engel's law applies in the Romanian economy, since 1990 to 2016, with specific evolutions and influences.

Suggested Citation

  • Neagu Mădălin-Ioan & Teodoru Mircea Constantin, 2017. "Testing the Engel's law in the consumption pattern of Romanian population," Studia Universitatis „Vasile Goldis” Arad – Economics Series, Sciendo, vol. 27(3), pages 33-53, September.
    • Handle: RePEc:vrs:suvges:v:27:y:2017:i:3:p:33-53:n:3
    DOI: 10.1515/sues-2017-0011
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    References listed on IDEAS

    as
    1. S. J. Prais, 1952. "Non-Linear Estimates of the Engel Curves," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 20(2), pages 87-104.
    2. Kaus, Wolfhard, 2013. "Beyond Engel's law - A cross-country analysis," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 47(C), pages 118-134.
    3. Jana Hovorková, 2015. "Evaluation of Consumer Standard of Living in the Czech Republic in the Period 2010-2013: Application of Revealed Preference Theory in Discussion with Engel's Law [Vývoj životní úrovně spotřebitele ," Acta Oeconomica Pragensia, Prague University of Economics and Business, vol. 2015(6), pages 21-46.
    4. Deaton,Angus & Muellbauer,John, 1980. "Economics and Consumer Behavior," Cambridge Books, Cambridge University Press, number 9780521296762, January.
    5. Andreas Chai & Alessio Moneta, 2010. "Retrospectives: Engel Curves," Journal of Economic Perspectives, American Economic Association, vol. 24(1), pages 225-240, Winter.
    6. Andreas Chai & Alessio Moneta, 2013. "Back to Engel? Some Evidence for the Hierarchy of Needs," Economic Complexity and Evolution, in: Andreas Pyka & Esben Sloth Andersen (ed.), Long Term Economic Development, edition 127, pages 33-59, Springer.
    7. Ulrich Witt, 2001. "special issue: Learning to consume - A theory of wants and the growth of demand," Journal of Evolutionary Economics, Springer, vol. 11(1), pages 23-36.
    8. Tuttle, Charlotte & Kuhns, Annemarie, 2016. "Percent of Income Spent on Food Falls as Income Rises," Amber Waves:The Economics of Food, Farming, Natural Resources, and Rural America, United States Department of Agriculture, Economic Research Service, issue 08, pages 1-1, September.
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    More about this item

    Keywords

    Engel's law; income; consumption; time-series model;
    All these keywords.

    JEL classification:

    • B12 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - Classical (includes Adam Smith)
    • B22 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Macroeconomics
    • E - Macroeconomics and Monetary Economics
    • C01 - Mathematical and Quantitative Methods - - General - - - Econometrics
    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes

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